Australia Enacts Modern Slavery Law

On November 29, Australia became only the second country in the world to enact legislation to fight modern slavery when the country’s Parliament passed the Modern Slavery Act. The new Australian legislation is similar to the UK’s Modern Slavery Act, which was enacted in 2015, inasmuch as both statutes seek to fight modern slavery by getting companies to crack down on such practices in their supply chains. There are, however, important differences between the laws as to their scope and enforcement.

Like the British law, the new Australian law applies only to companies whose annual revenues exceed a threshold amount—A$100 million in the case of the Australian law, and £36 million for the British law ($72 million and $46 million USD at current exchange rates). That said, the new Australian law specifies that qualifying companies must issue reports within six months of their fiscal year-end describing the structure of their supply chains, the risk of modern slavery practices therein, and the actions they are taking to assess and address those risks. By contrast, the UK law encourages the publication of reports on this timeframe and merely provides guidelines for the form and content of such reports.

There are also differences between the two laws in terms of the penalties for non-compliance. In the UK, the Secretary of State may apply to the High Court to impose fines and enjoin the compliance of organizations that fail to heed the Modern Slavery Act’s reporting requirements. By contrast, there are no penalties in the Australian law for non-compliance save for having the organization’s name appear on an official government list of scofflaws.

Ultimately, neither the Australian nor the British laws ban companies from having modern slavery in their supply chains; rather, the strategy is to force companies to report on their practices so that watchdog organizations and the general public can “name and shame” them into improving their practices. As pressure mounts to enact modern slavery laws in a host of other jurisdictions, now is the time for companies to get serious about assessing the prevalence of modern slavery in their supply chains and take decisive action to stamp it out.

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